Key Points
- The British Pound declined heavily towards 1.2770 against the US Dollar before recovering.
- There is a major bearish trend line forming with resistance near 1.2845 on the hourly chart of the GBPUSD pair.
- Recently in the UK, the Gross Domestic Product for Q2 2017 was released by the National Statistics.
- The outcome was around the forecast of +0.3%, as the Gross Domestic Product rose 0.3% (QoQ).
GBPUSD Technical Analysis
The British Pound struggled a lot lately and broke the 1.2850-40 support area against the US Dollar. The decline was sharp as there was even a break below the 1.2800 handle and the 21 hourly simple moving average.
The GBPUSD pair traded as low as 1.2771 and currently correcting above the 21 hourly simple moving average and the 23.6% Fib retracement level of the last decline from the 1.2917 high to 1.2771 low.
On the upside, there is a major bearish trend line forming with resistance near 1.2845 on the hourly chart. Moreover, the 50% Fib retracement level of the last decline from the 1.2917 high to 1.2771 low is at 1.2844 to act as a resistance.
UK’s Gross Domestic Product
Recently in the UK, the Gross Domestic Product for Q2 2017 was released by the National Statistics. The market was positioned for an increase of 0.3% in the GDP compared with the previous quarter.
The actual result was around the forecast of +0.3%, as the Gross Domestic Product rose 0.3%. In terms of the yearly change, there was a rise of 1.7% in the GDP, which was in line with the forecast. The report stated that:
UK gross domestic product (GDP) in volume terms was estimated to have increased by 0.3% between Quarter 1 (Jan to Mar) and Quarter 2 (Apr to June) 2017, unrevised from the preliminary estimate.
Overall, there is a chance that the GBPUSD pair corrects higher, but it won’t be easy for it to break 1.2845.
